1. How should mixed costs be classified in CVP analysis? What approach is used to effect the appropriate classification?
2. At the high and low levels of activity during the month, direct labor hours are 90,000 and 40,000, respectively. The related costs are $165,000 and $100,000. What are the fixed and variable costs at any level of activity?
3. "Cost-volume-profit (CVP) analysis is based entirely on unit costs." Do you agree? Explain.